United Arab Emirates (UAE): Setting Up Life Insurance

United Arab Emirates (UAE) is a state that is built on expats. As of 2018, 84% of the country, or over 7.8 million people, were expats out of 9.2 million total residents. India is by far the most common expat population in the country, accounting for 2.62 million expats. Pakistan, Bangladesh, Philippines, Iran, Egypt, Nepal, Sri Lanka and China make up a major portion of the remaining expats.

The community of expats have led to businesses from around the world opening up in the country to cater to the varying nationalities and culture.

Arabic is the UAE’s national language and one that makes it difficult to secure life insurance. Expats living in the country should have two main types of insurance:

  • Expat term life insurance
  • Critical illness insurance

Both insurance options work well together and provide you with a robust insurance option.

Why You Need Life and Critical Illness Insurance

Life is unpredictable, but insurance helps protect against unforeseen events that can cause illness or death. Expats living in the United Arab Emirates should have insurance, particularly life and critical illness insurance.

  • The right life insurance policy will ensure your family is taken care of if you die unexpectedly while living in the UAE. Term life insurance is the most popular option, and it provides a lump sum of cash if you die within a pre-agreed time period. As the name suggests, term life insurance is valid for a certain period of time – generally 5-25 years. Whole life insurance will cover you for your entire life. Premiums for this type of coverage are invested, and the policy will pay out whenever you die regardless of the reason.
  • Critical illness insurance will cover the cost of medical emergencies, like a heart attack, cancer or a stroke. In many cases, accidental death benefits are also included in critical illness coverage.

If you have health insurance in your home country, you may be wondering why you need critical illness coverage. The answer is simple: Any insurance coverage that you have in your home country probably won’t cover you in the UAE.

Coverage generally only applies to the country where you purchased the insurance.

Issues With Expats Seeking Insurance in Their Home Country or in the UAE

United Arab Emirates is an Arabic-speaking country. When you go to sign a contract for term life insurance or any form of insurance, you must be able to read the contract. Translators may be able to assist you, but there’s a chance that you’ll be signing a contract that you don’t understand.

The terms, conditions and exemptions are all integral parts of contract law and dictate how your policy will be dispersed upon your death.

If the terms mention that you have to be a citizen of the country, your beneficiaries may not receive a payout. The only compensation that your beneficiaries may receive if your policy is found to be void is the repayment of the premiums you paid.

Insurers will often allow you to sign and pay premiums with little scrutiny of the information that you supply.

Policyholders that lie on their application may be allowed coverage and to make payments, but on their demise, the insurer may perform more due diligence. If the application had errors or inaccurate information, the claim may be denied.

Seeking insurance in your home country may be an option, but you have to be very cautious when signing the paperwork. Oftentimes, there are stipulations that state you must reside in the country for more than six months of the year.

Expats that reside in another country may have their policy voided because they spend the majority of their time in the UAE.

What are your options?

Online expat term life insurance or critical illness insurance is the best option. These insurance policies are written for expats and offer coverage that can span multiple countries, regions, continents and even over hundreds of countries in some circumstances.

When policies are written for expats, they include the extensive coverage you need while living in the UAE as an expat. These policies are also written in your native language, allowing you to understand the contractual terms of the policy.

Obtaining a quote online is fast and easy, and if you’re under 50 with no serious medical history, you can often get approval without a medical exam.

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